Parallel with developing modern financial instruments in Iran’s capital market after introducing options contracts, it is now time to introduce Venture Capital Funds and developing market for Small to Medium Sized Enterprises(SME). Up to now, Farabourse has received 9 listing requests for Venture Capital funds, five of which have obtained the required licenses from the Securities and Exchange Organization and it is planned that after the listing of two funds, namely Arman Ati and Parsian Lotus Fund, three other will also be offered in this group. On the other hand, within the small to medium sized enterprises Gameron Petro Industry Complex has also been offered and it is arranged that from this point companies that have the qualifications to be admitted at this market, will be traded at two trading boards which are Roshd and Danesh Bonyan.
The main factor that instigated such markets was the small share of knowledge based companies in the country’s capital market, for instance the share of venture capital funds in the developed stock markets around the world is around 40 percent, however such companies are estimated to have a share of 2-3 percent at the domestic capital market. The most important element that should be taken into account in investing in such companies is the special investment method of these funds. The attracted resources by Venture Capital funds are allocated to investment in knowledge based companies, which by combining the expertise of directors active in these types of companies with financial management of those active in the funds, it can bring a suitable amount of profit for investors.
On the other hand, within the market for small to medium sized enterprises which has been recently added to Farabourse markets, 5 companies have so far applied for being listed and it is probable that after being examined by the Securities and Exchange Organization and acquiring the required licenses, they will be offered in SME market. This market has been created to fill up the need for a market specifically designed for small enterprises so that the owners of such companies could easily finance through capital market. This has happened in the large capital markets of other countries such as Toronto Stock Exchange, London Stock Exchange, South Korea Stock Market, Borsa Istanbul, and Bombay Stock Exchange. In the market for small to medium sized enterprises and on the trading boards of Roshd and Danesh Bonyan, these companies will have the opportunity to grow, finance and commercialize their projects and eventually will have the ability and readiness for public offering in larger markets. Being listed in these markets will help the company in its early commercial cycle to acquire the necessary transparency needed to enter the capital market and have the opportunity to accomplish branding and acquire credibility by being present at the capital market. It is anticipated that developing modern financial instruments will help increasing of participation of various social classes in the capital market, which will further deepen the market and increase its efficiency.
